Kweichow Moutai (600519.SH) addressed channel confidence, a lower gross margin, an interim dividend and the scarcity of Moutai liquor at its 2026 third-quarter results briefing on November 10. Director Wang Li, acting as general manager, said the industry remains in a deep adjustment.
“The industry is still in a deep adjustment. Consumer demand is weak, and the trend of fewer consumption scenarios has not fundamentally changed. Both Kweichow Moutai liquor and Moutai sauce-aroma liquor face challenges and tests from the market,” Wang said, according to The Paper.
She said market-oriented reform is meant to build, on top of supply-side balance, a system in which supply fits demand, volume and price are balanced, and the market is orderly and stable. The company should not chase indicators for their own sake or sacrifice longer-term conditions for short-term gains, she said, and that is the main direction of its next stage of market work.
Moutai began a consumer-centered, demand-driven reform at the start of 2026. Wang said the markets for Moutai liquor and Moutai sauce-aroma liquor now generally show matching supply, stable prices and healthy channel inventories. She said the earlier work had achieved some results and met the company’s expectations, while the market still had to be viewed objectively.
The Paper reported that revenue rose and net profit edged lower in the first three quarters, while both revenue and net profit grew in the third quarter, exceeding some institutions’ expectations during the industry downturn. It did not give company-wide revenue or net-profit figures. Asked whether the results meant performance had bottomed, that Moutai would lead a move through the cycle, and that fourth-quarter and full-year results could turn positive, Wang said she hoped shareholders and investors would look at Moutai over a longer cycle. If operations remain sound and market fundamentals stay steady, she said, the company can move through the cycle and achieve high-quality, sustainable development.
Contract liabilities and gross margin
Contract liabilities were 2.084 billion yuan at the end of the third quarter, down about 74% from 8.007 billion yuan at the end of the previous year, The Paper reported, citing the third-quarter report. For liquor companies, contract liabilities are often treated as a reservoir of future performance and a sign of dealers’ willingness to pay in advance.
Wang said the traditional industry practice of using advance payments to push inventory onto channels no longer fits deep changes among consumers, and the size of advance receipts is no longer the main measure of supply and demand. In 2026, she said, the company has focused on consumers and demand and has tried to match supply with the market instead of stuffing channels. Sales through self-operated channels that reach consumers more directly, and a consignment model in social channels in which title to the goods does not transfer, do not create advance receipts. The company also allocates products to social-channel dealers according to sell-through and inventory in each region and arranges payment only before allocation, in order to keep channels healthy.
Gross margin for the first three quarters was 89.58%, down 1.71 percentage points from a year earlier. Wang said sales volume rose year on year from January through September 2026 and operating costs rose with it, while the combined price per tonne across the product range moved back toward real consumer demand and revenue per tonne fell. Because costs rose faster than revenue, the gross margin was slightly lower. She said the profit-to-cost-and-expense ratio for the first three quarters of 2026 was in a reasonable range compared with the company’s level over nearly the past ten years.
Moutai liquor, series liquor and capacity
In the first three quarters, Moutai liquor revenue was 112.925 billion yuan, up 2.18% year on year. Series-liquor revenue was 17.969 billion yuan, up 0.48%.
Wang said that, with the industry in a deep adjustment and demand weak, the company had carried out a market transition “fully toward the consumer.” Sales of Moutai liquor were steady and orderly, the sauce-aroma market was basically stable, and supply, prices and channel conditions were generally sound.
On the small rise in series-liquor revenue, she said the company pushed ahead with the market transition for Moutai sauce-aroma liquor, dropped the old model of growing by stuffing inventory, and shifted to finer operations that place goods according to sell-through. The focus was better allocation, inventory control, a stable price level, stronger sell-through and more efficient spending. The company used the “double festival” sales period, and results showed stable prices with higher volume.
She said both Moutai liquor and Moutai sauce-aroma liquor still face market challenges. For Moutai liquor, earlier reforms focused more on the supply side, while this round focuses on the market. Volume-price balance and market stability are important grounds for judging whether operations are healthy, and product placement must also protect supply-side balance under traditional production methods.
For sauce-aroma liquor, she said the third quarter captured the double-festival sell-through opportunity after the earlier transition. Channel inventory was healthy overall, terminal sell-through was relatively good, and third-quarter operating revenue rose substantially year on year. She said the team’s effort deserved recognition, but product strength, brand strength and the market base still need to improve, as does the level of refined, sell-through-driven operation. Market stability and volume-price balance will be the main reference points for later operations.
Wang said that since the company listed in 2001, cumulative operating revenue from Moutai sauce-aroma liquor has exceeded 160 billion yuan, and its share of the listed company’s revenue has risen from 3.54% to 13.72%. The business has developed separate brands, including Moutai 1935 and Moutai Prince, with some influence in the sub-premium and mid-to-high-end markets. She said it will continue to build on a broader base of sauce-aroma consumers, develop more consumption settings, deepen recognition of the Kweichow Moutai brand and reinforce the company’s longer-term foundation.
On base-liquor capacity, Wang said xiasha production for the 2027 Moutai liquor year — the first sorghum-feeding stage — has already ended. After an earlier overall assessment, the company did not add new Moutai base-liquor capacity.
iMoutai, channels and scarcity
Revenue through the digital platform iMoutai was 58.562 billion yuan in the first three quarters, up 3.61 times year on year, and contributed more than 40% of company revenue.
An investor asked whether the shift from pushing product through channels to demand pulled by consumers means Moutai has in substance recovered terminal pricing power, and how it plans over the long term to balance direct sales with traditional dealers. Wang said earlier reforms focused more on supply, while this round focuses on the market, with volume-price balance and market stability as important tests of healthy operations. Channel coordination will be the focus of future market-oriented work, she said.
She set out three points. First, while keeping the channel system and business model stable, further improve the authorization and cooperation arrangements for social-channel partners and raise coordination across product sales, market promotion, brand communication and service. Second, keep iMoutai focused on consumers’ demands for fairness, authenticity and convenience, and gradually move from the current rush-buying model toward everyday selling that meets demand. Third, keep expanding the customers reached by self-operated stores, open sales to the public and meet real consumption demand.
Wang said iMoutai has basically put the full ranges of Moutai liquor and Moutai sauce-aroma liquor online. Next, it will first move from rush buying toward everyday sales that meet consumer demand; second, serve as the first-release platform for new products; and third, be developed as the company’s service middle platform, working with offline stores and other service outlets to improve service for consumers.
Asked about the view that Moutai is no longer scarce because consumers can buy it on iMoutai, in self-operated stores and in specialty stores, Wang said the scarcity of Moutai liquor comes from the long-term interaction of a unique and unreplicable natural ecology, micro-ecology and cultural ecology. She said layers of insulation on the supply side previously left consumers afraid to buy, unable to buy, or having to pay a premium. In essence, she said, supply did not match demand and did not reach real consumers. Blocked circulation and speculation made buying extremely inconvenient, and the idea that specialty stores had no liquor had become a widely shared view. Treating the inability to buy — caused by hoarding, speculation and a speculative premium in distribution — as scarcity misunderstands the scarcity of Moutai liquor, she said.
Overseas revenue, the interim dividend and cash flow
Revenue from foreign markets was 1.641 billion yuan in the first three quarters, down 57.85% year on year. Wang said that in 2026 overseas markets faced both the shared pressure of weak consumer demand and other challenges, including channels that did not match demand well enough, differences in culture and taste, regulation and logistics costs. The international business was under considerable pressure.
She said the company is respecting actual market conditions and continuing to shift its international strategy. It has acted to lighten the load on channels and has adjusted the pace of supply, and it has continued to deal with “reflow liquor,” tightening control of overseas channels and stepping up action against violations so exported products do not flow back and disturb the domestic market. Those adjustments had some effect on international revenue in the period, she said. The company will stick to a long-term approach, keep improving the overseas channel system and market conditions, and strengthen the base for international development.
On the interim dividend, chief financial officer and board secretary Yu Siming said that under the company’s cash-dividend return plan for 2024–2026, the cash dividend for each of those years is paid in two parts, an annual dividend and an interim dividend. The board is preparing the 2026 interim profit-distribution plan under authorization from the shareholders’ meeting and will complete that interim distribution within 2026 in line with the plan. He said investors should watch later company announcements for the specific plan and timing.
Net cash flow from operating activities from the beginning of the year to the end of the reporting period was 84.059 billion yuan, up 120.07% year on year. Yu said this was mainly because, in the first three quarters of 2026, the finance company took in more deposits from member units of the group, while interbank deposits that the finance company could not withdraw on demand matured and were recovered. Net operating cash flow from the liquor business in the first three quarters basically matched the results of the main business and rose slightly year on year, he said.
According to Dazhihui VIP, Kweichow Moutai closed on November 10 at 1,439 yuan a share, down 0.41%, with a market capitalization of 1.8 trillion yuan.
Original article: The Paper
